Global Carbon Capture, Utilisation, and Storage Market Outlook to 2050

Market Growth and Capacity Projections

The global market for carbon capture, utilisation, and storage (CCUS) is projected to increase 28-fold by 2050, according to Wood Mackenzie. The consultancy forecasts:

1. Capture capacity to reach 2 billion tonnes per year.
2. Storage capacity to reach 2.4 billion tonnes per year.
3. An investment opportunity of $1.2 trillion in point-source emissions-linked capacity, which involves capturing carbon directly from sources such as factory smokestacks.

Wood Mackenzie predicts the gap between capture capacity and storage capacity will narrow from nearly 50% in 2030 to approximately 20% by 2050.

Challenges and Policy Uncertainties

• Uncertain subsidies and policy incentives, particularly in the US and Asia-Pacific, may slow CCUS development.
• High costs, regulatory hurdles, and public acceptance remain significant barriers.
• The emissions reduction potential of point-source capture is limited, projected to abate only 4% of total emissions by 2050, which is below the 6% reduction needed to limit global warming to 2.5°C.

Importance of Cross-Border Collaboration

Wood Mackenzie emphasizes the critical role of cross-border carbon transport and storage hubs to scale up CCUS capacity. Europe and Asia are expected to account for nearly half of the global transport opportunity.

Key collaboration areas include:

• Technical standards and interoperability.
• Carbon accounting and verification.
• Liability frameworks.

Fauzi Said, Senior Research Analyst at WoodMac, stated that strong governmental cooperation in these areas is essential for success.

Investment and Regional Focus

To date, $80 billion has been committed to CCUS projects, mainly from the US, Canada, and European countries. However, further investments will be necessary, especially in Asia beyond 2035, according to Hetal Gandhi, WoodMac’s Asia-Pacific CCUS lead.

Near-Term Forecast and Need for a Multifaceted Approach

• WoodMac revised its 10-year CCUS forecast downward by 22%, citing policy uncertainty in the US and slow policy development in Asia.
• Despite strong growth projections, most economies are expected to achieve only 50%-70% of their CCUS targets by 2050.
• WoodMac highlights the necessity of integrating CCUS with other clean energy technologies and efficiency measures to meet decarbonisation goals.

Current Status and Sector-Specific Insights

Existing Projects and Emissions Data

• As of 2024, there were 50 operating carbon capture projects worldwide, with a total storage capacity of 51 million tonnes of CO2 per year (Global CCS Institute).
• The shipping industry, responsible for approximately 2.3% of man-made CO2 emissions, emitted 911 million tonnes of CO2 in 2023 (International Council on Clean Transportation).

Policy and Regulatory Considerations

Policy support for CCUS remains uncertain. In February, the UK Parliament’s Committee of Public Accounts reported that CCUS is expensive and unproven, recommending regular assessments of its effectiveness and value for money by the UK’s energy department.

The committee warned of a high risk that CCUS might not deliver the required carbon reductions within necessary timescales, potentially jeopardizing the government’s carbon reduction targets.

Alignment with Sustainable Development Goals (SDGs)

SDG 7: Affordable and Clean Energy

Scaling CCUS technologies contributes to the transition towards cleaner energy systems by reducing carbon emissions from industrial and energy sectors.

SDG 9: Industry, Innovation, and Infrastructure

Investment in CCUS infrastructure and innovation supports sustainable industrialization and fosters resilient infrastructure development.

SDG 13: Climate Action

• CCUS is a critical tool for mitigating climate change by capturing and storing CO2 emissions, aligning with global efforts to limit temperature rise.
• Cross-border collaboration and policy frameworks enhance the effectiveness of climate action strategies.

SDG 17: Partnerships for the Goals

Successful deployment of CCUS relies on international cooperation, technical standardization, and shared accountability, exemplifying the importance of global partnerships to achieve sustainable development.

Conclusion

While the CCUS market is poised for significant growth by 2050, realizing its full potential requires overcoming financial, regulatory, and social challenges. Strategic investments, robust policy frameworks, and international collaboration are essential to harness CCUS as a vital component of a multifaceted approach to sustainable development and climate change mitigation.

1. Sustainable Development Goals (SDGs) Addressed or Connected

1. SDG 7: Affordable and Clean Energy
   • The article discusses carbon capture, utilisation and storage (CCUS) technologies as part of clean energy solutions.
2. SDG 9: Industry, Innovation and Infrastructure
   • Development and scaling of CCUS infrastructure and technologies are highlighted.
3. SDG 13: Climate Action
   • The core focus on reducing CO2 emissions and limiting global warming aligns with climate action goals.
4. SDG 17: Partnerships for the Goals
   • Emphasis on cross-border collaboration, government cooperation, and investment partnerships.

2. Specific Targets Under Those SDGs

1. SDG 7: Affordable and Clean Energy
   • Target 7.2: Increase substantially the share of renewable energy in the global energy mix.
   • Target 7.a: Enhance international cooperation to facilitate access to clean energy research and technology.
2. SDG 9: Industry, Innovation and Infrastructure
   • Target 9.4: Upgrade infrastructure and retrofit industries to make them sustainable, with increased resource-use efficiency and greater adoption of clean technologies.
3. SDG 13: Climate Action
   • Target 13.2: Integrate climate change measures into national policies, strategies and planning.
   • Target 13.3: Improve education, awareness-raising and human and institutional capacity on climate change mitigation.
4. SDG 17: Partnerships for the Goals
   • Target 17.16: Enhance the global partnership for sustainable development, complemented by multi-stakeholder partnerships.
   • Target 17.17: Encourage and promote effective public, public-private and civil society partnerships.

3. Indicators Mentioned or Implied to Measure Progress

1. Carbon Capture Capacity
   • Indicator: Total annual carbon capture capacity in tonnes (e.g., projected 2 billion tonnes per year by 2050).
2. Carbon Storage Capacity
   • Indicator: Total annual carbon storage capacity in tonnes (e.g., projected 2.4 billion tonnes per year by 2050).
3. Investment in CCUS Technologies
   • Indicator: Total investment amount in point-source emissions-linked capacity (e.g., $1.2 trillion opportunity).
4. Emissions Reduction
   • Indicator: Percentage of total emissions abated by point-source capture (e.g., 4% by 2050 vs. 6% needed).
   • Indicator: CO2 emissions from shipping (e.g., 911 million tonnes in 2023) as a baseline for reduction efforts.
5. Number of Operating CCUS Projects
   • Indicator: Number of active carbon capture projects globally (e.g., 50 projects in 2024).
6. Policy and Regulatory Progress
   • Indicator: Presence and effectiveness of subsidies, policy incentives, and regulatory frameworks supporting CCUS.
   • Indicator: Government assessments and public acceptance levels.
7. International Collaboration
   • Indicator: Number and effectiveness of cross-border carbon transport and storage hubs and agreements.

4. Table of SDGs, Targets and Indicators

Source: lloydslist.com